Emerging technologies are expanding. Digital transformation has become popular recently. Businesses seek it to keep up with new tech norms. Therefore, digital transformation in asset management is no exception.
Although, it is no surprise that digital transformation is now mainstream. The shift from traditional framework to digital is massive. 57% of US business leaders think that it is now their most important strategic initiative.(https://www.broadridge.com/resource/asset-management/asset-management-in-digital-transformation )
Also, digital transformation is revolutionizing asset management. It offers unmatched benefits, such as cutting costs, improving efficiency, and enhancing customer experience. Therefore, we expect a steep upward trend in the future as more businesses adopt this mechanism.
As the digital transformation in asset management is reshaping industries, it is not just a buzzword. In this article, we will explore the future of digital asset management through the lens of digital transformation.
What is Digital Transformation?
The process of using technology to change the way a business operates is digital transformation. 74% of businesses say AI is significantly changing how they work (Broadridge study report on North American firms:https://www.broadridge.com/resource/asset-management/asset-management-in-digital-transformation ). Since the purpose of digital transformation is to bring agility and efficiency, it includes everything from automation to adopting new digital tools.
However, each business has its motivating factors to go for digital transformation like upgrading traditional systems, staying competitive, or improving its operations.
The Existing Asset Management Landscape
Traditional asset management involves manual or batch processing. It involves paperwork and depends on physical interaction. However, with digitalization, a major shift is happening in how we manage our tasks and assets.
According to a report, experts expect the asset and wealth management industry to reach $145.4 trillion by the end of 2025. This growth will coincide with digital adoption. Machine learning, artificial learning, and data analytics are taking over business. They will wipe out how we manage assets with best practices in digital asset management.
The Impact of Digital Transformation on Asset Management
Digital transformation is having a massive impact on asset management companies. Like other businesses, asset management is also observing a massive shift in how it can work best for other businesses. Digital asset management has also brought numerous benefits for businesses that have adopted it.
Let us look at digital transformation's impact on asset management.
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Real-time Information
Digitalization of asset management provides the ability to retrieve real-time information. That is driving organizations to make learned decisions, as they understand the performance of their assets. Moreover, they use this updated information to optimize asset utilization and reduce maintenance costs.
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Predictive Asset Management
Digitalization is helping businesses to make predictive decisions rather than reactive. Managers are now better placed to examine trends over a period and identify problems before they happen.
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Centralized Control
Assets management has improved after digitalization as it provides centralized control. You can sit anywhere in the world and access your assets thus offering better management solutions.
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Improved Visibility
Since you can access your assets remotely, this significantly improves visibility. Moreover, it also equips managers to make informed decisions.
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Improved Asset Utilization
Digital asset management best practices to help managers better understand their assets. Therefore, enabling them to better utilize and efficiently manage their assets. It will reduce underlying costs and improve revenues.
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Faster Asset-Related Decision Making
Digitalization enables quick information supply through data analysis. It identifies trends, enabling organizations to make better decisions. The decision-making speed is also backed by efficient and accurate data study techniques.
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Greater Transparency And Asset Traceability
Digital transformation promises visibility as the key for any asset throughout its lifecycle. Since, you can view your assets from anywhere in the digital world, meaning you have better control over your assets. Moreover, traceability also helps you better accountability in asset management.
Embracing Digital Transformation
Businesses are under pressure to adopt digital transformation to stay competitive. In 2020, a worldwide in-depth study of trends and concerns in the asset management space concluded that 72% of respondents are planning to develop digital assets over the next three years(https://www.bnymellon.com/content/dam/bnymellon/documents/pdf/insights/asset-management-transformation-is-already-here-digital-imperatives-dominate.pdf ). Meaning, asset management is one of the industries feeling the heat from stakeholders for adoption.
However, how can organizations adopt digital transformation in asset management? Let’s have a look.
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Willingness and Budget
Willingness is one of the key aspects of embracing digitalization at work. Despite the world moving to new methods, some managers are reluctant to adopt the change.
Therefore, you must show willingness and set aside finance as a token of confirmation of your interest.
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Change the Acceptance
Motivating your employees and fostering a change acceptance culture is mandatory for running a successful digital transformation. Therefore, creating an environment where people are open to accepting new ideas and technologies is critical for asset management digital transformation.
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Develop a Team
To start digitalization, you must build a team from within the organization. The team must fully know the business process to oversee the shift. By doing so, you make them responsible for success. You also train them for the future.
The Future of Asset Management is Digital
Long gone are the days when you would an asset manager would request a file to check the status of its assets. The Internet of Things has already changed businesses. It has changed how they operate, from predictive maintenance to asset tracking.
Furthermore, AI and machine learning have let businesses automate work. They can do this while keeping a high level of accuracy. Cloud computing dominates today’s digital imperatives. Almost all (96%) of the highest revenue-generating companies now use cloud computing. They use it to drive digital and operational change (https://www.bnymellon.com/content/dam/bnymellon/documents/pdf/insights/asset-management-transformation-is-already-here-digital-imperatives-dominate.pdf )). They also rank it as the single most important technology at present.
Likewise, we expect asset management to become data-driven. Asset managers will have access to real-time insights. Moreover, they will be able to make well-informed decisions about asset utilization and risk management.
Also, managing assets in the digital world will be more collaborative. Mobile apps and cloud storage will make accessing these assets easy. Thus, enabling teams to work on complex problems while staying apart.
In short, digital transformation is the future of asset management. It will optimize processes, cut costs, and boost profits.
Frequently Asked Questions
What is digital strategy for asset management?
Here are the key steps involved in digital transformation.
- Defining objectives
- Review existing assets
- Establish metadata
- Determine access and permission
- Choose a digital asset management system
- Develop a workflow
- Set up governance
- Train the team
- Monitor and measure
- Optimize and update
What does digital asset management do?
Digital asset management is the organizing, storing, and retrieving of assets.
Who needs digital asset management?
Anyone looking to optimize business processes should adopt a digital asset management system. It can include both small and large-scale businesses.
Does digital transformation have a future?
The business dynamics suggest that the digitalization of assets is here to stay. Since AI and machine learning have already transformed the entire arena, so we expect that will have a long-term say in business conduct.
Parting Thoughts
Asset management digital transformation is one of the best things to happen to the business world in the recent past. The business world is moving to digitalization. So, asset management has also greatly gained from advancements.
Asset managers have real-time information about their assets. Therefore, they are now best placed to make timely and accurate decisions.
With the rise of AI and machine learning, businesses can predict the future from current trends. This helps them offer great risk management.
Digital transformation is the future of asset management. It enables high efficiency, safety, and accessibility. In short, digital transformation is everything a business can ask for, thus becoming a need of the hour.
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